The Other Reason Medicare Is Getting Stronger

The federal government banned almost 15,000 fraudsters from billing Medicare in just the last two years, new data from the Department of Health and Human Services (HHS) finds — over a two-fold increase from the two years before that. The crackdown is a consequence of Obamacare anti-fraud provisions and may be part of the reason that Medicare’s trustees recently projected that it will be solvent for two full years past what they originally believed.

Medicare providers can defraud elderly Americans on the program through shoddy practices such as “upcoding” the cost of their services, self-referring patients for unnecessary tests and procedures, and even stealing seniors’ Medicare beneficiary numbers to profit off of their government health coverage.

Anti-fraud provisions in Obamacare seek to end that status quo. The reform law allows HHS and the Justice Department to home in on potential Medicare fraudsters by analyzing data that indicates fraudulent behavior. The government has concentrated its policing efforts on regions that have histories of Medicare fraud.

Government officials were helped in large part by elderly Americans on Medicare who reported suspicious activity — also something that is encouraged by the health law. About 45,000 phone calls about possible fraud were made to the Medicare hotline last year alone.


The one-two punch of sifting through Medicare claims data for signs of fraud and enlisting seniors as whistle-blowers against fraudsters has paid off. Thursday’s new figures indicate that the government recovered $14.9 billion in Medicare fraud money over the past four years.

While that top line number is a drop in the bucket compared to Medicare’s $3 trillion budget, it obscures the true long-term savings of the anti-fraud efforts. The increasing frequency with which doctors, nurses, and providers are being banned from billing Medicare strengthens the underlying entitlement, since most major perpetrators of Medicare fraud are repeat and volume offenders. Now, they’ll be cut out of the system entirely.

That’s likely one reason that the Medicare Trustees concluded the program’s hospital insurance trust fund will be fully solvent through 2026. That’s two more years than they projected just last year, and over a decade longer than what the trustees predicted in 2009 before the passage of the Affordable Care Act.

The Obama administration plans to offer consumers further incentives to report fraud in the coming days. A new proposed rule would raise the potential government reward for Americans who report Medicare fraud from $10,000 to almost $10 million.